Important Rules for Using SMS in Your Collection Strategy

Oct 4, 2023

Text messaging is a quick, easy, and cost-effective way to communicate with consumers. Debt collectors may consider using text messages to remind consumers of an upcoming payment, send payment confirmation, warn about an expiring payment method, and more.

Fortunately, the laws for communicating with consumers through text message are clearer, making it easier to modernize your communication strategy and stay compliant.

Whether your text strategy is in the works or you’ve already implemented it, it’s important to make sure you’re following relevant regulations, namely the TCPA and Regulation F. Failing to follow these regulations can result in complaints, lawsuits, or fines.

We’ll provide more details below, but here’s an overview of the requirements under both laws:

  • You must obtain express consent from consumers before sending messages
  • You must provide a way for consumers opt out of messages
  • You must only message recipients between 8 AM and 9 PM (their time) or other times that are convenient for the consumer
  • You must honor opt-outs

TCPA Defined

The Telephone Consumer Protection Act, or TCPA, is federal law that regulates telemarketing calls, auto-dialed calls, prerecorded voice messages, and unsolicited fax advertisements. The primary goal of the TCPA is to protect consumers from unwanted and intrusive communications.

Reg F Defined

Regulation F was implemented by the Consumer Financial Protection Bureau to modernize and clarify the rules governing debt collection practices. It covers communication practices, validation of debts, electronic communication, and other related matters.

SMS Requirements Under the TCPA and Reg F

Debt collectors should consider both the TCPA and Reg F before using text messages (SMS) to communicate with consumers. This ensures your practices are in compliance with consumer privacy and consent standards. Here are some key considerations:

Prior consent

Collection agencies must get consent from consumers before sending text messages.

TCPA: Consent can be written or oral, but should be clear and unambiguous.

Reg F: Consumers need to affirmatively agree to receive text messages, either in writing or electronically.

Phone number verification

Under Reg F, collection agencies aren’t allowed to send text messages to a consumer unless, within the past 60 days, they’ve confirmed the phone number hasn’t been reassigned.

Opt-out option

Every text message should include a simple and reasonable way for consumers to opt-out of receiving future messages. The easiest way is to allow consumers to text STOP, CANCEL, QUIT, UNSUBSCRIBE, or something similar to opt-out immediately.

After the consumer opts-out, you can send one additional text message confirming, but it can’t contain any other information.

Reg F: Collection agencies are required to stop communicating with consumers if they send a written refuse to pay or cease communication notice.

Frequency and timing

Messages should be sent during business hours, between 8 AM and 9 PM. Excessive messages may violate both the TCPA and Reg F.

Reg F: Reg F also specifies that firms can’t communicate with consumer at times they know or should know are inconvenient. For instance, if a consumer asks not to sent text messages after 5pm, firms are required to honor this request. Message timing is based on when the collection agency sends the message, not when the consumer receives or views the message.


Text messages should not contain false, misleading, or deceptive information. They should provide accurate and clear information about the debt, including the amount owed and the options available for resolving the debt.

TCPA: Messages should include a link to your terms and conditions and privacy policy.


Text messaging is an excellent option to have in your communications options. They’re convenient and direct. Following the relevant regulations is key to taking advantage of SMS in a way that respects consumers and keeps your firm compliant.

By clicking “Subscribe” you agree to HealPay’s Privacy Policy and consent to HealPay using your contact data for newsletter purposes.

Related Posts